RECRUITMENT & HIRING
The questions to ask a Malaysian recruitment agency before you sign
Most checklists ask whether an agency is any good. The ones that save you money ask what the agreement obliges — and what the law already obliges the agency to show you.
Ask four things. Show me your JTKSM licence. When exactly does the fee become payable, and what voids the replacement guarantee? How long do you own a candidate you introduce, and what if we already had them? And what happens to our live roles if your licence is suspended?
- The Act fixes the agency’s duties, not your commercial terms. Under the Private Employment Agencies Act 1981, “No person shall carry on any recruiting activity unless he has been granted a licence under this Act”, on pain of “a fine not exceeding two hundred thousand ringgit”.
- Everything expensive sits in three clauses: the fee trigger, what voids the guarantee, and how long the agency owns a candidate it introduced. None is set by law.
- A licensed agency already keeps the records you want — of job seekers, employers, vacancies, placements and fees, kept “for a period of not less than six years”.
- If you pay the placement fee, your candidate must not: “no placement fee shall be demanded by the private employment agency from the job seeker”.
- An agency winding down owes notice — “at least sixty days from the date of cessation”.
| Ask | Why it costs money | A straight answer sounds like |
|---|---|---|
| Show me your JTKSM licence | No licence, no regulator to escalate to | A number you can match to the register |
| When is the fee earned? | Whether you pay for a no-show | One named event, written in |
| What voids the guarantee? | Turns a replacement into a write-off | A short exclusion list, volunteered |
| How long does an introduction last? | Whether you can be billed twice | A stated period, a stated start point |
| What if we already had the candidate? | A frequent double-fee dispute | An agreed way to prove prior contact |
| What if your licence goes? | Live roles and data are mid-flight | A handover position, not a shrug |
Have terms of business in front of you? WhatsApp Steph at Carriera for a second read — including where the answer is “this one looks fine”.
The Department of Statistics Malaysia counted 194.8 thousand vacancies in the first quarter of 2026 against 9.03 million filled jobs — a 2.1 per cent vacancy rate, rising to 2.8 per cent for skilled roles. Agency agreements get signed quickly, and read once.
Before you open the agreement
What should you check before you read a Malaysian agency’s agreement?
Check that the agency holds a current JTKSM licence and that it is in the name of the entity on your agreement. This is the one part of the deal where the standard is set by statute rather than by the agency — and the only part you can verify without asking anyone.
The Act is blunt:
“No person shall carry on any recruiting activity unless he has been granted a licence under this Act.”
— Private Employment Agencies Act 1981 [Act 246], section 7(1), official reprint published by JTKSM
An unlicensed supplier is not cheaper; it is the one with no regulator behind your engagement.
- Ask to see it. A licensed agency “shall display its licence in a conspicuous place in the premises as specified in the licence”, so a photograph should be easy to produce. Every advertisement it runs must already carry “the licence number” — so take the number, the licence category and the expiry date.
- Match the name. The licence must belong to the company you are contracting with: an agency “shall not assign or transfer any licence granted under this Act to any person” without the Director General’s prior written approval.
- Check the register. Confirm both against the Department of Labour Peninsular Malaysia’s register of licensed agencies; our guide to hiring through a recruitment agency in Malaysia explains the categories.
Ask too what happens if that licence goes. The Director General may “suspend or revoke a licence granted under this Act” without compensation, and an agency winding down must give notice “within the period of at least sixty days from the date of cessation of operation”. Every licensed agency has also deposited a money guarantee with the Director General “in accordance with the category of licence”. Who hands your live roles and candidate data back, and in what form?
The clauses that cost you
Which clauses decide what a bad hire actually costs you?
Three: the fee trigger, the guarantee and the payment terms. Ask which event makes the fee payable, what the guarantee gives you and what voids it, and how long you have to pay. Ask separately whether the quote includes service tax — two identical-looking quotes often are not.
Is the fee earned on offer acceptance, on the first day, or on completing probation? Only one of those leaves you paying for someone who never turned up. Get the triggering event named in a sentence you could read aloud in a dispute. Ask too whether the engagement is exclusive, and for how long.
The guarantee is where disappointment lives. Ask what it gives you — a free replacement, a partial refund, or a credit note spendable only with the same agency — how long the window runs, and what voids it: specifically, whether redundancy, a restructure or your own late payment do. On the arithmetic, see how agency fees work, contingency vs retained and SST on agency fees.
One point is settled by law. An agency may not charge a job seeker a fee “in excess of that as specified in the First Schedule”, and where the employer pays the placement fee, the candidate cannot be charged one as well. If you are paying, your candidate should not also be.
Whose candidate is it?
Who owns a candidate, and for how long?
Ask how long an introduction stays live, what happens when two agencies send the same person, what happens when the candidate had already applied to you direct, and whether the agency will agree not to approach your staff. These decide whether you can be billed twice for one hire.
Four things belong in the ownership clause of a Malaysian agency agreement, and a fifth is worth asking for.
- When the clock starts, and how long it runs. An introduction has a shelf life — a period during which, if you hire that person, the fee is owed even if the hire arrives by another route.
- What is an “introduction”? Sending a CV and interviewing the candidate are different standards; the agreement should name the one it means.
- When two agencies send the same person. The agreement should say whose fee it is, and how the tie is settled.
- When the candidate already applied to you direct. A licensed agency keeps records of job seekers, vacancies and placements for at least six years, so ask how prior contact gets proved — on both sides.
- Whether your own staff are off limits. Ask the agency to agree in writing not to approach them, and for how long after the engagement ends.
Our hiring timeline guide shows where these arise.
Paper you can expect
What can the agency show you about its records and your candidates’ data?
A licensed agency must already keep records of job seekers, employers, vacancies, placements and fees collected, for at least six years. Ask how they are held, who inside the agency can read a CV you were sent, and what happens to that data when the assignment ends.
“A private employment agency shall keep the records for a period of not less than six years from the date after it is recorded.”
— Private Employment Agencies Act 1981 [Act 246], section 19(2)
That retention duty is a fair basis for asking how CVs are stored and who can read them. Our note on background and reference checks under the PDPA covers consent.
How we answer these
How does Carriera answer these questions?
Carriera recruits under MoHR licence JTKSM 615, held by Agensi Pekerjaan Carriera Talent Resources Sdn Bhd (1058296-H). We work a role through a six-step process that is complete only when an offer is accepted, and we would rather answer these questions in the first conversation than in the third month.
Carriera places permanent white-collar roles across logistics and freight, medical devices, electronics, precision manufacturing, accounting and finance and retail, and has served 50 or more companies. If you are holding someone else’s terms of business, ask us — we will also tell you when a clause is perfectly normal.
Employer questions
What else do employers ask before signing?
Do recruitment agencies in Malaysia have to be licensed?
Can an agency charge both us and the candidate for the same placement?
Is a replacement guarantee required by law in Malaysia?
Sources consulted and verified on 28 August 2026:
- Private Employment Agencies Act 1981, Laws of Malaysia — the licence requirement and its penalty, display and non-transfer of the licence, job-seeker fees and the receipt duty, the employer-paid placement fee rule, the money guarantee, the six-year record retention, suspension or revocation, and the sixty-day cessation notice.
- Department of Statistics Malaysia, Employment Statistics, First Quarter 2026 — 9.03 million filled jobs, 194.8 thousand vacancies, a 2.1 per cent vacancy rate, 2.8 per cent for skilled roles.
- Department of Labour Peninsular Malaysia, List of Private Employment Agencies — the public register.
General information for employers, not legal advice.
Reading an agency agreement this week?
Send Steph the clauses you are unsure about. Carriera holds MoHR licence JTKSM 615 and places permanent white-collar talent across Peninsular Malaysia — and we would rather you signed a good agreement, whoever it is with.
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